“The average shareholder definitely does not care about the value of R&D to the firm long after their deaths, or I suspect any time at all after they sell the stock.”
This was addressed in the post: the price of the stock today (when its being sold) is a prediction of its future value. Even if you only care about the price that you can sell it at today, that means that you care about at least the things that can lead to predictably greater value in the future, including R&D, because the person you’re selling to cares about those things.
Also worth noting: the reason that the 2% value is meaningful is that if firms captured 100% of the value, they would be incentivized to increase the amount produced such that the amount they create would be maximally efficient. When they only capture 2% of the value, they are no longer incentivized to create the maximally efficient amount (stop producing it when cost to produce = value produced). This is basically why externalities lead to market inefficiencies. The issue isn’t that they won’t produce it at all, it’s that they will underproduce it.
“The average shareholder definitely does not care about the value of R&D to the firm long after their deaths, or I suspect any time at all after they sell the stock.”
This was addressed in the post: the price of the stock today (when its being sold) is a prediction of its future value. Even if you only care about the price that you can sell it at today, that means that you care about at least the things that can lead to predictably greater value in the future, including R&D, because the person you’re selling to cares about those things.
Also worth noting: the reason that the 2% value is meaningful is that if firms captured 100% of the value, they would be incentivized to increase the amount produced such that the amount they create would be maximally efficient. When they only capture 2% of the value, they are no longer incentivized to create the maximally efficient amount (stop producing it when cost to produce = value produced). This is basically why externalities lead to market inefficiencies. The issue isn’t that they won’t produce it at all, it’s that they will underproduce it.